You want to open a BANKNIFTY iron condor with a maximum theoretical risk of ₹2,500. Your broker blocks ₹1,15,000 in margin. What's going on? Welcome to SPAN + Exposure margin — the Indian F&O capital requirement framework that confuses every new trader.
This playbook decodes how margins work, shows exact numbers for popular Indian strategies, and helps you size your account realistically.
1. SPAN Margin — The Core
How it works
SPAN simulates 16 scenarios: price moves ±3.5 range points, IV changes ±100%, combinations. For each scenario, it computes your portfolio's loss. The worst-case loss becomes your SPAN margin. Typical magnitude: 10-15% of contract notional.
2. Exposure Margin
Exposure is a fixed buffer on top of SPAN. Currently ~3% of notional for index futures, 5% for stock futures. Not scenario-based — just a flat add-on to absorb unforeseen moves.
Total margin
Total Margin = SPAN + Exposure
For a single NIFTY long call: SPAN = ₹0 (no risk), Exposure = ₹0 (long only). Total = 0. Premium paid = full cost.
For a single short call: SPAN might be ₹18,000, Exposure ₹4,000. Total = ₹22,000 per lot.
3. Margin by Strategy
Typical Indian F&O Margins 2026April 2026
| Strategy | Lot Size | SPAN | Exposure | Total |
|---|
| Long NIFTY Call | 25 | 0 | 0 | Premium only |
| Short NIFTY Call | 25 | ₹18,000 | ₹4,000 | ₹22,000 |
| NIFTY Bull Call Spread | 25 | ₹2,500 | ₹500 | ₹3,000 |
| NIFTY Iron Condor (200 wide) | 25 | ₹35,000 | ₹8,000 | ₹43,000 |
| NIFTY Short Strangle | 25 | ₹55,000 | ₹12,000 | ₹67,000 |
| BANKNIFTY Iron Condor | 15 | ₹90,000 | ₹25,000 | ₹1,15,000 |
| BANKNIFTY Short Strangle | 15 | ₹120,000 | ₹30,000 | ₹1,50,000 |
| RELIND Cash-Secured Put | 500 | ₹95,000 | ₹25,000 | Full strike × lot in cash |
BANKNIFTY positions require 2.5-3× NIFTY margin due to higher contract value.
4. Minimum Account Size for F&O
Bare minimum: ₹2 lakhs. Allows 1-2 NIFTY iron condors.
Comfortable: ₹5 lakhs. Allows 3-4 concurrent positions, rolls, adjustments.
Professional: ₹15+ lakhs. Allows multi-strategy, multi-underlying programs with buffer.
5. Margin Optimization Tips
Use spreads over naked shorts: Iron condors get partial margin benefit vs two naked shorts.
Trade NIFTY over BANKNIFTY: Same exposure, ~2.5× less margin.
Check 'Margin Saved' on your broker: Zerodha and Upstox show how much hedging saves — use this to design capital-efficient trades.
Close at 50%: Freed capital redeploys to new trades, doubling annual capacity.
See real margin for every strategy
Strategy Lab integrates with broker margin APIs to show exact capital required.
Open Strategy Lab →Frequently Asked Questions
What is SPAN margin?
SPAN (Standard Portfolio Analysis of Risk) is the risk-based margin framework used by NSE. It simulates 16 different market scenarios (price up, price down, volatility changes, combinations) and charges you the worst-case loss among them. SPAN is dynamic — it changes daily based on market volatility. A typical SPAN margin is 10-15% of the contract value.
What is Exposure margin?
Exposure margin is an additional cushion on top of SPAN, typically 3-5% of contract value. It acts as a buffer for intraday price movements and end-of-day settlement risk. Together, SPAN + Exposure = total margin required. For most NIFTY option positions, total margin is 15-20% of notional contract value.
Why is my iron condor margin so high?
Because SPAN treats each short leg as independent short risk unless you have a qualifying hedged position with wings. Even with wings, SPAN doesn't always give full credit. A 200-point wide NIFTY iron condor with ₹3,875 max loss can still require ₹40,000-60,000 in margin — 10x the actual maximum risk. This is SEBI's conservative approach post-2020 rules.
Do hedged positions get margin benefit?
Yes, partially. SPAN recognizes spreads (iron condor, bull call, etc.) and gives partial margin benefit — you pay less than two separate naked shorts but more than theoretical defined-risk. Example: Two naked short BANKNIFTY legs might need ₹2 lakh. The same legs combined into an iron condor might need ₹1.1 lakh — meaningful benefit but not as much as max-loss would suggest.
Can I trade F&O with ₹50,000?
Barely. Post-SEBI margin rules, minimum capital to meaningfully trade F&O is ~₹2 lakhs. With ₹50,000, you could theoretically hold 1 NIFTY iron condor — but you'd have zero buffer for adjustments, rolls, or market moves. Recommended minimum: ₹3-5 lakhs for comfortable F&O trading.
What's the difference between Initial and Maintenance margin?
Initial margin is what you need to OPEN a position (SPAN + Exposure). Maintenance margin is what your account must hold DURING the position (typically SPAN only, slightly lower). If market moves against you and your account falls below maintenance margin, you get a margin call — usually same-day. Most Indian brokers auto-liquidate if you don't add funds.
Track total margin blocked across brokers
Multi-broker F&O dashboard. See total margin across ICICI, Zerodha, Upstox.
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